Fannie Economist Sees $2.6T in Refis

The decline in mortgage rates to 45-year lows is going to boost refinancings to $2.6 trillion this year, nearly matching last year's record for total originations, according to Fannie Mae chief economist David Berson.For all of 2003, the Fannie Mae economist is predicting that lenders will originate a record $3.7 trillion in one- to four-family loans. Next year, he is forecasting a decline in originations to $2 trillion. Mr. Berson told reporters that the housing and mortgage finance markets are operating at a "stupendous pace" and that he has noticed no effect from the news about the management shake-up and accounting problems at Freddie Mac. "There has been no noticeable impact in the housing market or the mortgage market," the economist said. Mr. Berson said he expects the Federal Reserve to reduce interest rates by 25 basis points at its June 24/25 meeting.